Look beyond the slogan
Joe Carlson’s interview with outgoing Federal Trade Commission Chairman Jon Leibowitz (“Championing consumers,” Feb. 9, p. 18) repeated one of the chairman’s favorite catchphrases, “pay- for-delay,” in the matter of patent settlements, but missed the point. As you might expect, there is more to the complex matter than a slogan, and that is why, over the past eight years, the courts repeatedly have said that it is the patent, not the settlement that keeps the generic off the market.
Some facts should not be overlooked:
The settlements are pro-competitive because they allow the generics to enter the market months and even years ahead of brand patent expirations. Not one patent settlement agreement has ever delayed the market entry of the generic drug past the expiration of the actual brand patent.
Patent settlements are transparent. Under federal law enacted in 2003, every patent settlement agreement is required to be submitted to the FTC and the Justice Department within 10 days of being reached. These two federal agencies have authority under that law to challenge those agreements they considered anti-competitive or anti-consumer.
Over the past decade, generic drug manufacturers have prevailed in only 48% of the nearly 400 drug patent litigation cases. This means that without settlements, consumers have less than a 50-50 chance of gaining access to the lower-cost generic medicines prior to brand patent expiration. But when a patent settlement is reached, consumers gain access to the lower-cost generic medicines prior to patent expiration 100% of the time.
And because of improved access, patent settlements save consumers billions of dollars every year. In 2011, according to IMS Health, 17 of the 22 generics that went on the market were the result of patent settlements.
When the whole story is told, readers will agree that patent settlements are pro-competitive and pro-consumer.
Ralph G. Neas President and CEO Generic Pharmaceutical Association